Google plans transit-oriented San Jose, CA campus

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Dive Brief:

Google is planning a transit-oriented development for downtown San Jose, CA, in an effort to reduce its workers' reliance on car commutes, according to The Mercury News.

The project could bring up to 20,000 Google workers to the city, which currently hosts tech companies like Adobe Systems, Cisco and eBay.

Google is eyeing real estate near city's Diridon Station, which is served by rail options including BART, Amtrak and Caltrain. The city has already indicated a desire to upgrade the station. Google’s plans call for 6 million to 8 million square feet of office and research and development space as well as retail.

Dive Insight:

Google’s latest project aims to be more easily accessible to workers who commute through the dense Bay Area by public transit and by car. The company is also seeking to more directly address the statewide housing shortage with its separate plans to purchase 300 modular housing units that will likely serve as a short-term employee housing.

The region’s technology boom has played a key part in the lack of affordable housing throughout the region. Four major counties in the Bay Area are each 10,000 rental units shy of meeting the affordable housing needs of its residents. Residents in those counties who earn less than 50% of the area median income put more than half of their earnings toward rent.

If the state’s current population growth and homebuilding activity levels don’t change, its affordable housing shortage will only worsen. According to California’s Department of Housing and Community Development, California’s population is expected to reach 50 million by 2050, up from 39 million currently. Meanwhile, the state needs an average of 180,000 new homes created annually to sustain that growth, although just 80,000 have been built each year over the last decade.

California isn’t the only state in which elevated home prices are making housing unaffordable to many current residents. Home prices are rising all over the country as limited inventory meets burgeoning demand. The latest S&P CoreLogic Case-Shiller U.S. National Home Price Index put prices nationwide up 6.9% from April 2016 to April 2017 and expects another 5.1% increase by next April. California saw price gains of 5.9% year-over-year while Washington (12%), Utah (10.1%) and Oregon (9.1%) led the list.

Some relief could be ahead — at least for the San Francisco Bay Area. The city’s Board of Supervisors recently approved the Affordable Housing Bonus Program, also known as HomeSF. The law will reward multifamily developers with up to two extra floors of space if 30% of the building’s units are reserved as affordable.